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Economic stimulus crucial for recovery – Ó Caoláin

Speaking at the
launch of his party’s pre-budget proposals today Sinn Féin Dáil leader
Caoimhghín Ó Caoláin announced a proposal for a state-wide investment programme
using 7 billion euros transferred from the National Pension Reserve Fund. (To download a PDF version of the document click 'Get PDF' link above)

“The key to
recovery is the provision of stimulus to get the economy moving again
by protecting and creating jobs and ensuring that those on lower incomes
are not pushed into poverty, thus further depressing the economy.

“We are proposing
a state-wide investment programme using 7 billion euros transferred from the
National Pension Reserve Fund. 2 billion would be spent on employment stimulus
in 2011. Making tax credits refundable, restoring the Christmas social welfare
bonus and removing the pay levy from those under the tax bracket would
assist people on lower incomes and increase their disposable income
at a time when more consumer spending is sorely needed.

“The Government
refuses to directly address the jobs crisis, even though there are now over
450,000 people unemployed in this State. It is obsessed with a narrow
view of fiscal rectitude because it has completely surrendered what remains of
our economic sovereignty to the very forces in both the national and the
international financial markets that caused the crash in the first place.

“Savage cuts are
being imposed, ultimately, not to re-float the economy but to bail out the
banks – with the bill for recapitalisation and NAMA coming to almost €90
billion.

“Fianna Fáil/Green
Government decisions are not based on the needs of the Irish people but on the
profit motive of international money-lenders.

“But there are
choices to be made and a better way is possible. The deficit and the borrowing
requirement can be reduced through revenue raising and saving and a stimulus
package to promote growth and jobs.

“Our multi-annual
plan has the potential to reduce the deficit earlier than 2016, between the
increased funds we identify from an overhaul of the tax system and the
financial return of our stimulus measures.

“Sinn Féin’s
employment and financial stimulus package costs €7.595 billion and will create
160,000 jobs directly over the medium-term, tens of thousands more jobs
indirectly and also save thousands of jobs.

“The full cost of
our employment stimulus amounts to €7 billion. The financial stimulus of €595
million is accounted for in our tax and saving measures. The multiplier effect
on GDP of creating 160,000 jobs would amount to 1.8%, according to ESRI
figures. And this would be real GDP growth – not growth based on the profits of
multinational companies based here.

“Our stimulus is
about providing immediate and direct employment in key sectors such as
infrastructure in the immediate term. But in the longer term, the impact of our
stimulus plan would see the state’s competitiveness increase as we become a
world leader in green energy, IT and research and development, in addition to
having world class infrastructure to attract Foreign Direct Investment and
support indigenous enterprise for longer-term employment creation. This
sustainable, long-term employment would broaden the tax base and secure it.” ENDS